Carlyle Said to Plan $2.5 Billion of Debt for Illinois Tool Unit

Feb 07, 2014 3:15 pm ET

Feb. 7 (Bloomberg) -- Carlyle Group LP, the Washington- based private-equity firm, is planning about $2.5 billion of debt financing for its buyout of Illinois Tool Works Inc.’s industrial-packaging unit, according to a person with knowledge of the deal.

The debt consists of $1.6 billion to $1.7 billion of first- lien loans and $800 million to $900 million of high-yield bonds, said the person, who asked not to be identified because the transaction is private. Carlyle obtained financing commitments from a group of banks including JPMorgan Chase & Co. and Goldman Sachs Group Inc., according to a statement yesterday.

Michael DuVally, spokesman for Goldman Sachs, and Tasha Pelio, a spokeswoman for JPMorgan, declined to comment. Reuters earlier reported details of the deal financing.

Carlyle agreed to purchase Illinois Tool’s industrial packaging business for $3.2 billion, expecting to complete the buyout in the middle of this year, according to the statement. Carlyle will finance the deal in part with equity from the $13 billion U.S. buyout fund it closed in November, the firm said.

--Editors: Chapin Wright, Faris Khan